Market Integration Study PDF

Market Integration By Group 1 Learning Objectives  History of Global Market Integration History of Global Market Integration As early as 19th century global market integration become a reality because of the advance development of technology. From the development of steam engines down to t...

Market Integration By Group 1 Learning Objectives  History of Global Market Integration History of Global Market Integration As early as 19th century global market integration become a reality because of the advance development of technology. From the development of steam engines down to the development of railroads and ports which pave way to faster world transport network. Market integration first peaked in 1913 when unfettered markets ruled the day. History of Global Market Integration As countries experienced the great depression and shunned international capital markets the integration declined for over 60 years. Global market integration began when large American companies began to emerge after the secon world war History of Global Market Integration There are 2 revolutions of history of global market integration The agricultural revolution Its a name given to a number of cultural transformation that initially allowed humans to change from hunting and gathering subsistence to one of agriculture and animal domestication Industrial revolution Transformed economies that has been on agriculture and handicrafts into economies based on large scale industry, merchandized, manufacturing and the factory system  What is Integration Integration shows the company's market relationship. The extent of integration affects the company's behaviour and thus their marketing efficiency. What is Market Integration A highly integrated market behaviour is different from disintegrated market behaviour. Kohls and Uhl have defined market integration as a process that refers to corporate expansion by consolidating additional marketing functions and activities within a single management framework Types of Market Integration Type s of Market Integration Horizontal Integration A competitive strategy that can create economies of scale, increase market power over distributors and suppliers, increase product differentiation, and help businesses expand their market or enter new markets. It can also provide access to new channels of distribution where a company can create or acquire production units for outputs that are both complementary and competitive. Type s of Market Integration Horizontal Integration ACQUIRING COMPANY ACQUIRED COMPANY (Minute Maid - Google Search, n.d.)  Type s of Market Integration vertical Integration A company becomes involved in new portion of the value chain. This approach may be desirable if the suppliers or buyers of a company have gained too much power over the company and use theirs ability to earn more profit at the expense of the company  Type s of Market Integration vertical Integration Jollibee Logo and symbol, meaning, history, PNG, brand. (n.d.). https://1000logos.net/jollibee-logo/  Type s of Market Integration Backward Vertical Integration A backward strategy of vertical integration involves a company moving back or upstream along with the value chain and entering the business of a supplier. If executives are concerned that a supplier has too much power over their firms, some firms use this strategy.  Type s of Market Integration Backward Vertical Integration CDNLogo. (n.d.). Tesla logo SVG, EPS, PDF, AI Vectors Free. CDNLogo. https://cdnlogo.com/logo/tesla_39673.html  Type s of Market Integration Forward Vertical Integration A forward strategy of vertical integration involves a company moving further down the value chain to enter the business of a purchaser.  Type s of Market Integration Forward Vertical Integration CDNLogo. (n.d.-a). Download Zara Logo PNG Transparent Background. CDNLogo. https://cdnlogo.com/logo/zara_37944.html Type s of Market Integration A conglomerate Integration Is a fusion of companies involved in completely unrelated business activities. There are two kinds of mergers of conglomerates: pure and mixed. Pure mergers of conglomerates involve companies with nothing in common, while diverse mergers of conglomerates involve companies looking for product extensions or market extensions. Type s of Market Integration A conglomerate Integration Facebook Logo and symbol, meaning, history, PNG, brand. (n.d.). Enjoy these X Logo Images for free. (2023, July 27). Freepik. https://1000logos.net/facebook-logo/ https://www.freepik.com/free-photos-vectors/x-logo Advantages ADVANTAGES There are a few concrete examples of merging benefits. A conglomerate merger benefits from both companies reaching a larger target audience. If Y merges with Z, both companies share the same market base, allowing them to spread their operations. Before the merger, each company was able to target only their market areas, but the two companies combined have twice as much reach, allowing both potential customers and businesses to grow and cross-refer to each other. Diversification is crucial in business and finance alike. Potencial Downfalls POTENTIAL DOWNFALLS An example of this is if one conglomerate that is involved in the merger has an excessive fortification over the other conglomerate. Identification can sometimes be a decline for individual businesses because they can spread in too many areas This type of coalescence can be detrimental as it limits the marketplace's newly formed business options. This is accompanied by the disadvantage of controlling and managing such a large conglomerate entity. To take care of this, the bureaucracy needed can be detrimental to the new conglomerate. Regardless, the structure of the company will be changed, creating potential problems along with the advantages.  The Role of International Financial Institutions in Creation of Global Economy  The Role of International Financial Institutions in Creation of Global Economy An international financial institution (IFI) is a financial institution that has been established (or chartered) by more than one country, and hence is subject to international law. The international financial institutions play a major role in the social and economic development of countries with emerging economies such as changing market positions. This includes advising, funding, and assisting on development projects to: reduce global poverty and improve living conditions and standards.  The Role of International Financial Institutions in Creation of Global Economy The World Bank's role is to reduce poverty by lending money to the governments nents of its poorer members to improve their economies and to improve the standard of living of their people. The Bank is also one of the world's largest research centers in development. The IMF promotes global macroeconomic and financial stability and provides policy advice and capacity development support to help countries build and maintain strong economies.  References Lobo, J. L., Ambida, M. N., Maliban, N. P., Mesinas, M. M., Umali, V. D., & Delos Santos, A. R. (2019). The contemporary world. Mandaluyong City: Books Atbp. Publishing Corp. JustineRapajon. (2024, March 30). Chapter-3-MARKET-INTEGRATION..pdf [Slide show]. SlideShare. https://www.slideshare.net/slideshow/chapter3marketintegration- pdf/267027824